Phil Rubin

CEO, rDialogue

Phil is CEO of rDialogue, an Atlanta-based customer marketing firm with clients ranging from mid-market to Fortune 100 and in industries including retail, travel and hospitality, telecommunications, dining, financial services and pharmaceuticals. Representative clients include Caribou Coffee, Cracker Barrel, Kimpton Hotels and Sprint, as well as a number of clients that can’t be named like a world famous customer-centric department store.

He has nearly 20 years of strategic marketing experience with an emphasis on customer loyalty and relationship marketing, integrated communications, partnership development, promotions and program development. He founded the loyalty practice at Loyaltyworks and led the spin-off of the practice to rDialogue. Prior to Loyaltyworks he was Group Vice President and General Manager of The Lacek Group, a loyalty marketing firm now part of OgilvyOne. While at Lacek he established the Atlanta office and was responsible for leading the development and implementation of relationship marketing strategies on behalf of clients such as Delta Air Lines, Cox Communications and UPS.

Phil has developed and managed loyalty and relationship marketing as a client both at Midway Airlines and at GTE Wireless (now Verizon). He began his career going through Macy’s Executive Training Program and working in store management.

Phil has an M.B.A. with a concentration in Marketing and Strategy from Tulane University and a B.S. in finance from L.S.U.

In traditional loyalty programs, engagement rewards -- really engagement recognition in the form of point accruals -- are not economically sustainable by themselves. So the answer is no, they won't replace them but they can be effective when they do what loyalty programs ultimately need to do: result in a better customer experience. That's why surveys (listening to customers) and completing profiles and updating preferences (broadening customer insights) are important.Loyalty programs have become entirely too transactional and engagement has suffered. There has been a 20 percent decline globally in participation among affluents (according to Collinson) and satisfaction levels have declined in tandem. Too many programs, too little differentiation and too little relevance. These engagement activities help, but ultimately will not be enough to overcome the lack of differentiation and customer relevance.

Haven't sales already killed department stores? When even Nordstrom succumbs and decides it can't run its business without (at least) seven promotional periods a year -- this from a legendary merchant who used to pride itself on only two sales per year -- it's hard to go against the grain. It has literally been decades since department stores have had the discipline to manage business by merchandising, and even some marketing, rather than markdowns.It will be interesting to see whether the NRF's expectations of +3.6 percent holiday revenues translate into any real growth in income for department stores. My expectation is that they won't and that ultimately Mr. Questrom will be proven correct.

It will be interesting indeed to see whether Whole Foods can roll out its loyalty program and not "race to the bottom." The focus appears to be largely one-dimensional, focus on pricing, offers and other discounts. Absent a broader focus beyond a transactional loyalty program it's entirely possible, if not probable, that it will indeed retain customers but dilute its margins, along with its brand.

Malls aren't dead but they have failed, along with their tenants, to deliver a compelling, relevant shopping experience, especially compared to Amazon and innovators like Warby Parker and Bonobos. Mall operators and retailers need to start thinking about customers first, which they are loathe to do, much as they have consistently failed to invest in technology to deliver the aforementioned better customer experience.

At least retailers like RL and SFA are trying to improve their customer experiences, even if they are not always compelling (RL). As more luxury goods are available online, and especially at Amazon, the bar will go up in terms of customer expectations of not just a good CX, but a better one. That's the only way a luxury mono brand like RL or a department store like SFA is going to sell goods at decent margins, much less have any customer loyalty for the next shopping opportunity.

Let's all remember this quote, especially the "full stop" portion of it. Amazon is not Wal-Mart. Amazon has now captured nearly 75% of affluent households in the U.S. as Prime members. There are lots of luxury brands for sale there now, including LVMH goods, albeit through 3rd party sellers and counterfeiters. While that's part of the challenge, they are on there because of economics, especially (not just supply but) demand. By not doing business with Amazon, LVMH effectively opens the door for those resellers and counterfeiters.While luxury brands have been slow to embrace innovation (e.g., ecommerce), affluent consumers value time and increasingly expect a better customer experience. Our office is across the street from a Nordstrom door. It's easier and far and away a better customer experience to stand in my office and shop from Amazon than it is to go to Nordstrom. Sad, but true.At some point a company like LVMH will take just the opposite approach of LVMH and make a deal with Amazon. Such a deal will present the opportunity to protect the integrity of its brands, get Amazon's help to keep counterfeit and grey market goods off the site and create a shop within a shop on Amazon. In the end, they will do a lot of business through Amazon.

Given that Amazon has been "obsessed" with customers for several decades plus, it's not a stretch to generalize that Amazon has a relatively unbeatable advantage in product search. At least in most categories and certainly as a broad-line merchant.First, there is a cultural advantage. Bezos gets it far beyond that of most retail CEOs, and he has for along time. His leadership, unwavering when it comes to customer-centricity, is nearly unrivaled among his contemporary peers.Second, there is a technological advantage. Amazon has continued to innovate and its extension and lead with platforms like Echo/Alexa are a testament to this.Third, Amazon has momentum. Just look at the metrics comparison year over year. Stunning in its power to continue to push its lead.Fourth, Amazon has earned the trust of its customers and, in turn, benefited from the engagement provided by that trust. Its primary business is not selling ads which makes it a formidable competitor to Google and others in paid search.Finally, Amazon leads in its ability to innovate and expand its value proposition. In only the last couple of weeks it has added benefits to Prime, expanded Amazon Music and at the same time reduced the monthly fee for it along with reducing the prices on Echo.

Beauty is the number one frequency driver for department stores and while not #1 for drug stores, it's still a significant traffic driver. So with this Amazon provides yet another reason for customers to NOT have to visit a shopping center for beauty items. This is a BIG threat for the reasons cited above but mostly because Amazon makes it easier to buy stuff than any other merchant on the planet. Bad news for those merchants that don't get the idea of putting the customer at the center of everything.

These pop-ups follow a similar strategy to Amazon Prime -- they are another means to engage customers in doing more business with Amazon and they will be very good for Amazon's business and customer relationships. We've long been of the mindset that Amazon sets the standard for retail innovation and customer experience.These pop-ups will make it even easier for customers to "get" Amazon and products like Echo. Another nail in the coffin not just for retailers but, increasingly, for brands that are unable to innovate around the customer experience.

Retailers have not been good storytellers for a while, though there are a few exceptions. In the vein of Upstanders, consider TOMS whose entire brand and mission is a powerful story. But they are an exception. In another vein, Brooks Brothers has some terrific content on their site and that they share via email, covering everything from the history of the blazer to the work of their Golden Fleece Foundation.Props to Mr. Schultz and Starbucks for being not just a dominant retailer but one with a conscience and a soul. That is increasingly missing in today's brand landscape.

I 100% approve of Lands' End selling an edit of its line on Amazon.com. It's a much more compelling alternative than to not selling it on their own site. There are not that many soft goods brands in the "popular" price range that will be able to survive without a relationship like Amazon. Amazon is too good at delivering a customer experience that no soft goods retailers has yet been able to match.One alternative would have been to follow J.Crew's lead and partner with a department store or other mass merchant. Oh wait — they already did that, right?Gap and Lands' End are the first of many to realize the path to long-term survival needs to include Amazon.

DM 101. It's a classic and proven testing strategy to compare the response of different offers, including "no offer." Customer loyalty and relationship building no longer requires more or richer transactional rewards, but rather a better experience. There's nothing loyalty-building about "$10 off" but if it's from a friend it's more meaningful and trades more — but not totally — on emotion.More importantly, the margin per sale is at least $10 higher without an offer for the one making the referral, making the campaign that much more profitable.

Two once great brands struggling to regain relevance, business and growth against a backdrop of upstarts and Amazon. For J.Crew it's a choice: pursue indirect business via doors like Nordstrom's or go the way of Gap and pursue indirect business through Amazon.Both companies will benefit, but the ultimate question is whether it will be enough to stabilize their businesses. My view: they both have a lot more work to do in order to begin to offer a customer experience in line with rising consumer expectations and increasingly discerning tolerances for irrelevance.

Best Buy, as everyone is agreeing, is on the right path with IoT and should easily outpace brick-and-mortar legacy rivals like J.C. Penney and Sears. Amazon, not so much. But Best Buy, more than other brick-and-mortar merchants, knows how to leverage its capabilities around customer data via CRM activities (e.g., Reward Zone, digital communications) that will amplify its physical advantages, including Geek Squad. Having nicely integrated payment and credit features helps as well and it's great to see Best Buy continuing on the right path.

It's very smart of Kohl's to recognize the value of beauty as a category, though this is not a newsflash to other more traditional department stores like Macy's and Nordstrom. Now more than ever, beauty as a category is a traffic driver, a frequency play and an "affordable indulgence" as much as it is a reflection on consumers seeking wellness, at least in terms of aging and appearance. It's recession-proof as even in tough times beauty is steadfast and often a contra-indicator (the "Lipstick Index").